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ISG hopes to pedal its way to success in the Far East

Olympic velodrome builder ISG is plotting a push into south Asia as the firm eyes up more overseas opportunities.

Earlier this year, the company formed a joint venture with Dubai-based Al Habtoor Leighton to carry out fit-out work in the hotel, residential and commercial sectors across the UAE.

Once legal wrangles have been cleared up, the JV is expected to begin formal trading at the end of next month with a brief to target Dubai and neighbouring Abu Dhabi.

But ISG chief executive David Lawther said the group is now looking further east and at getting into project management work in Thailand, Singapore and Malaysia.

ISG already carries out this sort of work in China and Hong Kong mainly in the hotel, leisure and office market.

He added that India was still on its radar but admitted that country’s infrastructure needed to be upgraded for it start making serious inroads there. He said: “If key clients move over once the infrastructure is up and running, then it’s an area that’s interesting to us.”

The firm’s Middle East operations has about 20 people but Mr Lawther said this would double quickly and he expected more to jet out there.

He said: “The region is resource strained in terms of the skills out there. There is an enormous amount of work on especially in offices and hotels. Abu Dhabi is trying to catch up with Dubai.”

Closer to home, the firm said trading in most of its key areas was holding up well. Mr Lawther said: “Public sector work is standing us in good stead and the food retailers are still spending.”The company is looking at associated work with its Ł80 million velodrome contract for the 2012 Games in London, such as the BMX track as well as a number of temporary venues.

About 43 per cent of the firm’s operating profit comes from the capital with half again coming from fit-out work. Mr Lawther said big jobs in this area were still spending - the firm recently won a £50 million contract with accountant KPMG at offices in Canary Wharf - but he admitted there would be a drop-off in the smaller to medium fit-out work.

Turnover at the firm in the year to June smashed the £1 billion barrier for the first time leaping 42 per cent to just under £1.1 billion, while pre-tax profit was up a quarter to £12.6 million.